{"id":288919,"date":"2023-09-08T14:35:33","date_gmt":"2023-09-08T19:35:33","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=288919"},"modified":"2023-09-08T14:35:33","modified_gmt":"2023-09-08T19:35:33","slug":"okada-manila-can-end-spac-deal-rules-delaware-judge","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/","title":{"rendered":"Okada Manila Notches Legal Win, Court Rules SPAC Deal Can Be Terminated"},"content":{"rendered":"

Universal Entertainment Inc. and its affiliates with ties to the Okada Manila integrated scored a legal victory Thursday when a judge in the Delaware Court of Chancery ruled the gaming entity doesn\u2019t need to move forward with a reverse merger proposed by Jason Ader\u2019s 26 Capital Acquisition Corp. (NASDAQ: ADER).<\/p>\n

\"Okada
The Okada Manila resort in the Philippines. A Delaware judge ruled the operator doesn’t have to merge with a US-based SPAC. (Image: Pinterest)<\/figcaption><\/figure>\n

Citing multiple factors, Vice Chancellor Travis Laster ruled that Okada Manila isn\u2019t obligated to proceed with a merger agreement<\/a> that was originally reached in October 2021. The judge also ruled that 26 Capital — a special purpose acquisition company (SPAC) — can seek monetary damages and that he\u2019ll make a ruling on that matter at a later date.<\/p>\n

If the SPAC proves breach, and if the defendants fail to establish their affirmative defences, and if the SPAC properly supports a sum of causally related damages, then the SPAC may be able to recover [damages],\u201d according to Laster\u2019s ruling.<\/p><\/blockquote>\n

The proposed merger was announced in October 2021 after several months of talks between Ader\u2019s blank-check firm and Universal Entertainment. It valued the gaming entity at $2.6 billion and had the deal been consummated, it would have paved the way for Okada Manila to list its shares on the Nasdaq.<\/p>\n

Where Things Went Wrong Between Okada Manila, SPAC<\/h2>\n

Typically, reverse mergers engineered via blank-check companies wrap up in a matter of months because the more rapidly the transaction is completed, the faster the SPAC\u2019s insiders are rewarded.<\/p>\n

\n

Obviously, an efficient timeline wasn\u2019t in the cards for Okada Manila and 26 Capital. Billionaire Kazuo Okada has stood in the way of that happening. He even attempted to seize control<\/a> of the integrated resort in May 2022 using 50 private security guards and members of the Paranaque City Police. By February 2023, 26 Capital was suing<\/a> Universal Entertainment and affiliates linked to the casino resort, alleging they were intentionally dragging their feet on merger talks.<\/p>\n<\/div>\n

The following month, Universal Entertainment said it wanted to halt the deal, filing a countersuit to that effect. Citing \u201cmaterial breaches of the merger agreement and fraudulent conduct by 26 Capital\u201d, Universal Entertainment released a regulatory filing on June 30 highlighting plans to scrap the deal.<\/p>\n

That kicked off a multi-month case in the Delaware Court of Chancery in which Universal Entertainment accused Ader of financial malfeasance and making unauthorized public comments about the state of Okada Manila\u2019s business while the SPAC fired back with accusations<\/a> that Universal insiders engaged in bribery of Philippine officials to hinder the merger.<\/p>\n

Vice Chancellor Laster ruled that forcing the transaction to reach the finish line might be a violation of a 2022 decision made by a Philippine court. The judge added that the SPAC failed to tell Universal and its affiliates that its primary advisor on the deal, Zama Capital hedge fund founder Alex Eiseman, was the majority investor in an affiliate of 26 Capital. That obfuscation could be seen as \u00a0\u201ca conspiracy to mislead Universal,\u201d noted Laster.<\/strong><\/p>\n

\u201cNot knowing that its contractual advisor was playing for the other team, the [Entertainment Universal side] entered into the merger agreement,\u201d according to the ruling. \u201cAfter signing, the target hired the hedge fund to assist with a series of deal-related tasks. When pursuing those tasks, the hedge fund continued to work as the SPAC\u2019s partner and against its client. It was not until this litigation that the target learned the truth.\u201d<\/p>\n

Next Steps for 26 Capital<\/h2>\n

The judge added that even had he ruled the merger must go through, he has no legal standing to enforce that decision.<\/p>\n

As for next steps for 26 Capital, the SPAC can attempt to find another merger partner or liquidate and return capital to shareholders. It didn\u2019t say whether it plans to evaluate either of those options, but it will pursue monetary damages.<\/p>\n

\u201cWe are disappointed by the Court’s ruling as the proposed merger benefits all parties, but we remain committed to enhancing shareholder value and will continue to explore all available strategic options,\u201d said Ader in a statement.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Universal Entertainment Inc. and its affiliates with ties to the Okada Manila integrated scored a legal victory Thursday when a judge in the Delaware Court of Chancery ruled the gaming entity doesn\u2019t need to move forward with a reverse merger proposed by Jason Ader\u2019s 26 Capital Acquisition Corp. (NASDAQ: ADER). Citing multiple factors, Vice Chancellor […]<\/p>\n","protected":false},"author":46,"featured_media":263000,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[69069,10,60,32093],"tags":[81913,81903,81928,81966],"acf":[],"yoast_head":"\nOkada Manila Can End SPAC Deal, Rules Delaware Judge<\/title>\n<meta name=\"description\" content=\"Okada Manila doesn't need to move forward with 26 Capital merger, rules judge.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Okada Manila Can End SPAC Deal, Rules Delaware Judge\" \/>\n<meta property=\"og:description\" content=\"Okada Manila doesn't need to move forward with 26 Capital merger, rules judge.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2023-09-08T19:35:33+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/The-Okada-Manila-resort-in-the-Philippines-at-night.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"960\" \/>\n\t<meta property=\"og:image:height\" content=\"681\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/\",\"url\":\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/\",\"name\":\"Okada Manila Can End SPAC Deal, Rules Delaware Judge\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/The-Okada-Manila-resort-in-the-Philippines-at-night.jpg\",\"datePublished\":\"2023-09-08T19:35:33+00:00\",\"dateModified\":\"2023-09-08T19:35:33+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Okada Manila doesn't need to move forward with 26 Capital merger, rules judge.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/okada-manila-can-end-spac-deal-rules-delaware-judge\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/The-Okada-Manila-resort-in-the-Philippines-at-night.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/The-Okada-Manila-resort-in-the-Philippines-at-night.jpg\",\"width\":960,\"height\":681,\"caption\":\"The Okada Manila resort in the Philippines. 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